Life insurers agree to multi-state settlements on unpaid death benefits
Tuesday, November 26, 2013 10:34 AM
Two life insurers with Iowa ties have agreed to pay settlements to state regulators related to an investigation of the companies' unclaimed property practices.
In a settlement announced Monday by Florida's insurance commissioner, West Des Moines-based North American Company for Life and Health Insurance and Midland National Life Insurance Co., based in Sioux Falls, S.D., agreed to pay $3.3 million to eight states, including Iowa, LifeHealthPro reported. Both companies are affiliates of West Des Moines-based Sammons Financial Group.
In a separate settlement, Aviva Life Insurance Co. and Aviva Life & Annuity Co. agreed last week to pay $4 million in fines to seven states, including Iowa, over their unclaimed property practices. The agreement was a condition of the company's sale to Athene Holding Ltd., the Bermuda-based holding company which purchased West Des Moines-based Aviva USA, now known as Athene USA, LifeHealthPro reported.
Each of the companies also agreed to use a master database of death records known as the Social Security Death Master File on a regular basis as a way of complying with state unclaimed property laws.
The settlements are part of an ongoing nationwide investigation by state regulators into the practices life insurers use in paying out claims of policyholders. Since the Life/Annuities Claim Settlement Practices Task Force was established in 2011, seven other major insurers, among them MetLife and ING, have agreed to pay $173 million in unpaid claims to beneficiaries and more than $800 million to the states.
The National Association of Insurance Commissioners is currently debating whether uniform national standards should be established for unclaimed death benefits.
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